Introduction - Washington University In St. Louis

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{1}Introduction/For that is what America is all about. It is the uncrossed desert and theunclimbed ridge. It is the star that is not reached and the harvest that issleeping in the unplowed ground.-Lyndon B. Johnson, from his Presidential Inaugural Address,January 20, 1965Many things come to mind when asked to describe the essence of Americaits energy and innovation; the various freedoms that Americans enjoy; theracial and ethnic mix of its people. But perhaps fundamental to the essenceof America has been the concept of the American Dream. It has captured theimagination of people from all walks of life and represents the heart and soulof the country.The American Dream has served as a road map for the way we often envision the course of our lives. The rules of the game are well-known, as is thebargain that is struck. For those willing to work hard and take advantage oftheir opportunities, there is the expectation of a prosperous and fulfilling life.The United States has long been epitomized as a land of equal opportunity,where hard work and skill can result in personal success and fulfillment, regardless of one's station in life. While the specifics of each dream vary from personto person, the overall vitality of the American Dream has been fundamental tothe nation's identity.It can be found throughout our culture and history. It lies at the heart ofBen Franklin's common wisdom chronicled in Poor Richard's Almanack, in thewords of Emma Lazurus etched onto the Statue of Liberty, the poetry of CarlSandburg, or the soaring oratory of Dr. Martin Luther King, Jr. It can beheard in the music of Aaron Copland or jazz innovator Charlie Parker. And itcan be seen across skylines from Manhattan to Chicago to San Francisco.Yet it can also be found in the most humble of places. It lies in the hopesof a single mother struggling on a minimum wage job to build a better life for

2Chasing the American Dreamherself and her children. It rests upon the unwavering belief of a teenager livingon some forgotten back road that one day he or she will find fortune and fame.And it is present in the efforts and sacrifices of a first generation American family to see their kids through college.In many respects, the American Dream has been deeply rooted in the conceptof a journey-the journey to a new country, the journey across generations,· and of course, the journey within one's life. It is about motion and progress, itis about optimism, and it is about finding succes.s and fulfillment along the way.And yet the conditions under which Americans have pursued this Dreamhave been fraught with risk and economic uncertainty. The settlers of the eighteenth, nineteenth, and twentieth centuries took enormous risks coming to thenew world, often arriving with little more than the clothes on their backs. Oncehere, there was not much in the way of government help or financial assistance(with the exception of available land). Self-reliance, rugged individualism, anddetermination were seen as the keys to prosperity. And yet, in spite of the risksand struggles, the American Dream has been, and continues to be, a guidingforce reflecting the manner in which we see our lives unfolding.Turn on the television, listen to the radio, surf the Internet, or pick up amagazine while waiting in an airport, and the images of the American Dreamare ever present. From the solidly middle class couple engaged in their careersand lifestyle, to the rags to riches superstar making millions of dollars eachyear, the American Dream is portrayed as attainable, as long as we commitourselves to hard work and perseverance in striving toward our goals.In his immensely popular history of America entitled The Epic of America,published in 1931 , James Truslow Adams was the first to coin the term "theAmerican Dream." He noted its centrality to the national identity, and wrotethat it,. has lured tens of millions of all nations to our shores in the pastcentury. [But it] has not been a dream of merely material plenty, thoughthat has doubtless counted heavily. It has been much more than that. Ithas been a dream of being able to grow to fullest development as manan woman, unhampered by the barriers which had slowly been erectedin older civilizations, unrepressed by social orders which had developedfor the benefit of classes rather than for the simple human being of anyand every class. And that dream has been realized more fully in actual lifehere than anywhere else, though very imperfectly even among ourselves.(1931: 405)The American Dream has ultimately been about the manner in which ourlives unfold and the ability of the individual, no matter where he or she comesfrom, to exert considerable control and freedom over how that process occurs. 1In a sense, it is about being able to live out our individual biographies to theirfullest extent.

Introduction3Take the quintessential American Dream of rising from rags to riches.During the latter part of the nineteenth century, Horatio Alger wrote dozensof stories about young street urchins who were able to lift themselves out ofimpoverished urban conditions through their hard work and moral strength,eventually finding wealth and acclaim in their lives. The popularity of thesestories was enormous throughout the late nineteenth and early twentieth centuries, and this particular pattern of success has remained in our national consciousness ever since.Or take the image of the American Dream that developed after World WarII-that of achieving a comfortable middle class standard of living. This dreamincluded a well-paying and stable job, a house in the suburbs, a family withtwo or three children, a new car in the garage, and a two-week summer vacation. Such images were broadcast weekly into America's living rooms throughradio and television programs such as Father Knows Best, The Adventures ofOzzie and Harriet, and Leave it to Beaver. The prosperous middle class lifestyleportrayed in these popular shows was seen as attainable for the majority ofAmericans.Today, the American Dream continues to place a heavy emphasis uponeconomic prosperity and financial security, along with other ambitions aswell-finding and pursuing a rewarding career, leading a healthy and personally fulfilling life, and being able to retire in comfort. But regardless of thetime or place, America has always been about the hope and promise of a goodlife. Of course, the American Dream has never guaranteed that hard work willensure economic and personal success, but it has been strongly suggested. Fromour earliest days to the present, millions have arrived on these shores seekingto improve their lives. America has long symbolized the land of opportunity,where skill and hard work are viewed as paths to personal success and economic well-being. While the specifics of each dream may vary from person toperson, the overall vitality of the American Dream has been fundamental tothe nation's identity. 2And yet some have wondered to what extent the Dream is simply that, adream rather than reality. One could argue that America's part of the bargain has never been fully upheld. Millions of Americans have been excludedthroughout our history from meaningful participation in the American Dream.In particular, race, class, and gender have loomed large in terms of who has hadgreater or lesser access to viable opportunities. This side of America is represented by ongoing poverty, racism, sexism, and economic retrenchment. It canbe found in the legacy of slavery, broken treaties, Jim Crow, glass ceilings, andlingering patterns of residential and educational segregation.Yet even for those not facing the constraints of race, class, and gender, working hard and having determination do not necessarily provide the ticket forsuccess. Many Americans today are working harder and for longer hours, onlyto find themselves falling further behind. Mounting evidence indicates that

4Chasing the American Dreamthis economic insecurity has been on the rise, with growing numbers of middleand working class Americans struggling to get by. In fact, we would argue thatapproximately four-fifths of the US population is at a significant risk of economic vulnerability at some point in their lifetime.3On the other hand, those at the top of the income distribution have experienced dramatic gains during the past decades. These discrepancies in economicwell-being have begun to shake the overall confidence level in the AmericanDream. The noted economist Paul Samuelson, writing in the first edition of hispopular introductory economics textbook in 1948, pointed out that if we made"an income pyramid out of a child's play blocks with each layer portraying 1,000 of income, the peak would be somewhat higher than the Eiffel Tower,but almost all of us would be within a yard of the ground" (1948: 63). By thetime of Samuelson's 2001 edition of the textbook, most Americans would bewithin two or three yards of the ground, but the Eiffel Tower would now haveto be replaced with Mount Everest in order to represent the top of the incomedistribution (Samuelson and Nordhaus, 2001: 386).Over the past four decades, the magnitude of both income and wealthinequality in the United States has been rising to levels not seen since those ofthe Gilded Age during the latter part of the nineteenth century. Recall that thiswas the period when the great mansions of the Vanderbilts, Astors, Rockfellers,and Carnegies were built on Fifth Avenue in New York City (along with theirpalatial summer residences in Newport, Rhode Island). At the same time,11 million of the 12 million US families in 1890 earned less than 1 ,200 annually, with an average income of 380.Today, we are seeing similar levels of income and wealth concentration. Forrelatively few Americans, things have never been better e99nomically. Theirwealth holdings and incomes have gone through the roof. Americans who findthemselves in the top 10 percent of the income distribution, particularly thosein the top 1 percent, have seen their incomes soar over the last few decades.At the same time, a growing number of families are being squeezed economically, wjth many struggling to stay afloat. For example, the median earnings ofmen working full-time in 1973, adjusted for inflation, were 51,670. By 2012,their median earnings stood at 49,398 (US Census Bureau, 2013a). In otherwords, the typical male worker in the United States has actually lost groundover the past four decades in terms of his wages, in spite of the fact that outputper employed worker grew 58 percent over this same period.If one divides the income distribution of the United States into fifths, theonly group that has increased its overall piece of the total income pie over the past 40 years has been the top 20 percent of the income distribution. Those inthe bottom 80 percent of the distribution have actually seen their overall pieceof the pie shrink.Or take what has happened to the distance between the average CEO'ssalary and the average worker's salary. In 1980, the average CEO of a major

Introduction5corporation earned 42 times that of the average worker's pay. Today the figurestands at well over 400 times. Adding insult to injury, from the 1980s onward,an increasing number of companies have demanded concessions from theirworkers, including pay cuts and the elimination of various benefits.Patterns of wealth accumulation are even more skewed. The top 1 percentof the US population currently own 42.9 percent of the financial wealth in thercountry (stock, bonds, savings, etc.), while the bottom 60 percent of Americansare in possession of less than 1 percent of the country's financial wealth (andif we focus on the bottom 40 percent, this group of Americans actually hasnegative financial wealth; Wolff, 2010). An example of such wealth concentration can be found in the fact that in 2010, the six heirs to the Walmart fortunewere worth as much as the bottom 41.5 percent of US households combined.According to Josh Bivens .at the Economic Policy Institute, the Walton heirsheld 89.5 billion in assets, which represented the net worth of the bottom48.8 million American households.These economic trends might be compared to what has happened in theairline industry. As anyone who has flown recently is well aware, the experienceof traveling in coach has deteriorated dramatically. The New York Times putsit this way,Over the past few years . flying in coach has become an increasinglymiserable experience. Leg room is practically nonexistent Passengersare more tightly packed together. Hot meals have been eliminated. Dittopillows and blankets. And the next time that guy in front of you leanshis seat back directly into your face, few of your fellow passengers arelikely to blame you if you feel a brief, murderous urge to strike back.(November 25, 2007)At the same time, first class passengers flying international have been reaching new levels of luxury. Four course meals created by celebrity chefs, choiceof premium wines, or "180-degree lie-fiat" seats on international flights thatinclude a large fiat screen monitor, audiovisual on demand, and noise-cancelingheadphones have all become the norm for the select few able to fly first class.For those in first class, life is good and getting better, while for the majorityin coach, things have deteriorated over time. So it would seem for America asa whole.The United States currently leads the developed world in the extent of itsincome inequality, the depth of its poverty, and the concentration of its wealth.In short, we are rapidly becoming a society of haves and have nots, with thehaves becoming fewer and wealthier, and the have nots becoming more numerous and more vulnerable.This vulnerability can be seen in a number of places. Job security has weakened, the social safety net has been shredded, benefits on the job have been

6Chasing the American Dreamharder to come by, savings and retirement funds have eroded. All of thesetrends have placed more Americans in an economically vulnerable positionwhen shocks in income occur. And income shocks have been increasing overthe past 30 years.The political scientist Jacob Hacker (2006) found that income volatility in the1990s was significantly greater than it was in the 1970s, with much of this volatility being downward mobility. At the same time, more Americans are at personalrisk when such changes in income occur. As Hacker writes, "in area after area,there's evidence of a vast shift in the economic security of most Americans-amassive transfer of financial risk from corporations and the government ontofamilies and individuals" (2004: 14). Likewise, Peter Gosselin (2008) notes thatthe volatility and swings of income have increased dramatically over the past30 years. Americans are increasingly on their own with respect to their financialprotection and well-being. This has become painfully apparent in light of thesignificant numbers of American jobs that have been downsized and outsourced.As a result, a vast number of American lives are marked by ongoing economicturmoil and strife. This is reflected in an increasing uneasiness about the abilityto achieve the American Dream. For example, a national survey was conductedseveral years ago by the Brookings Institution (2008). One of the questionsposed was, "Do you think it is becoming harder or easier these days to achievethe American Dream, or is it about the same?" Three-quarters of Americansfelt that the American Dream was becoming harder to achieve. Furthermore,69 percent felt that the American Dream would be harder for the next generation to achieve compared to the current generation, while only 15 percent ofrespondents felt that the next generation would be economically better off thantoday's generation. Similar results were obtained in a 2013 Washington Post pollthat asked if it was more difficult to get ahead financially today than in the past(Washington Post-Miller Center, 2013). For the vast majority of Americans,there is a sense that attaining the American Dream is becoming more difficult.In addition, a number of recent books have appeared with titles such asAmerican Dream Dying (McClelland and Tobin, 2010), Who Stole the AmericanDream? (Smith, 2012), or The Betrayal of the American Dream (Barlett andSteele, 2012). Many of these books discuss the economic and political conditions that have led to the deterioration of the middle class and their ability toachieve the Dream over the past 30 years.Yet is it time to write off the American Dream? This book takes a somewhatdifferent approach from these previous works. Rather than simply reviewingthe political and economic changes of the past 40 years, we first examine whatAmericans truly mean when they refer to the American Dream. As we shallsee, it is a somewhat different concept from the manner in which it is oftendepicted. Second, we explore the viability of various pathways to the AmericanDream. In order to do so, we make use of a unique life course methodologythat we have pioneered in our earlier work. This research reveals a number of

Introduction7surprising and unexpected patterns. And finally, we attempt to provide a somewhat different lens through which to interpret and assess the current and futurestatus of the American Dream.Searching for the American DreamWith this background in mind, we set about to search for the American Dreamand to understand the dynamics that shape our fortunes in these challengingtimes. But where to look and who to ask? How might one check the pulse of theAmerican Dream? We decided that the best approach was multidimensional.To begin, we felt it essential to talk to a wide range of Americans about theirexperiences, ideas, and lives. Ideally, these interviews would be able to provide arich context in which to understand the paths that people take in their pursuitof the American Dream, and what happens to them along the way. Second,we felt it important to empirically assess the overall strength of the AmericanDream in a clear and innovative way, and one that would represent the countryas a whole. And finally, we wanted to incorporate some of the seminal researchand thinking on this topic.Forming the backbone of the book is a series of interviews we conducted inand around a sizable metropolitan area located in the United States. The regionis largely reflective of the demographic and economic makeup of the countryas a whole. In addition, the area reflects much of the economic turmoil andchange that has been occurring in the country over the past 40 years. As such,we felt that it was a particularly appropriate site to measure the pulse of theAmerican Dream. The interviews occurred from September 2010 through July2011 with a total of 75 people.Our con sations across this window of time took place with a wide rangeof individuals pursuing many different pathways in their lives. The intent wasto talk to a group of Americans who would represent a diversity of experiencesand attitudes. This resulted in a kaleidoscope of American stories- from a factory worker, to a federal judge, to a waitress, to a former CEO of a Fortune 500corporation, to a world class jazz musician, to a stay-at-home mom, to a USambassador, to a hog farmer. The range of experiences was simply remarkable.For example, on one afternoon we interviewed an investment and tax lawyerwho was advising a handful of families with asset holdings of up to 3 billion.The following week we talked to a woman facing home foreclosure with no savings in the bank and a total of 40 left in her checking account.The interviews took place in various locations. Many were conducted inindividuals' homes or places of work, but others occurred in restaurants, meeting rooms, coffee shops, bars, and the like. A variety of topics were touchedupon, including what it was like growing up, work history, current finances, andthoughts about the American Dream and the country as a whole. In a handful

8Chasing th

published in 1931, James Truslow Adams was the first to coin the term "the American Dream." He noted its centrality to the national identity, and wrote that it, . has lured tens of millions of all nations to our shores in the past century. [But i

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