The use of the phrase “The American Dream” was first coined by James Truslow Adams in his 1931 book Epic of America. He described America as “that dream of a land in which life should be better and richer and fuller for everyone, with opportunity for each according to ability or achievement”. Over the years, this term has become one of the most iconic beliefs of America, becoming associated with upward mobility and economic success of anyone who dares in this land of opportunity. The American Dream gives hope to those of every economic status that they can and transcend class divides. However, has this trend of upward mobility lasted throughout the last 90 years, or has the American Dream become, well, only a dream?
According to a poll done by YouGov, over half the U.S. population (54%) believes that the American Dream is still attainable to them. About one-third of the adults polled did not think that it was attainable for themselves, but it might be for others. Finally, about 9% did not think that it was attainable to anyone, and that the ideal should be dropped. Millennials are the least likely group to believe in the Dream, with less than half believing they are able to realize it personally. Meanwhile Baby Boomers are highly optimistic, with 60% still reaching for the American Dream. Similarly, over half the populations of Gen Z (52%) and Gen X (53%) believe it is personally attainable as well.
The Declining Achievability of The American Dream
However, does the data support these beliefs? At its core, the American Dream is an aspiration of upward mobility; the belief that anyone can achieve anything, with the right work ethic and attitude. This is commonly measured by comparing a child’s ability to earn more than their parents did. Data collected by Opportunity Insights makes it clear that one’s ability to outearn their parents has been decreasing since the early 1900s. Declines are seen across income brackets, but those growing up in the middle-class have taken the largest hit. Individuals born in 1980 only have a 45% chance of outearning their parents at age 30, while those born in 1940 had a 93% chance.
Reasons for the Decline
One culprit for this decline in the ability to outearn one’s parents is the stagnation of wages. The minimum wage in 1938 was a quarter, or around $4.65 in 2021 dollars. Compare that to our national minimum wage of $7.25 today. Our minimum wage has not even doubled in the last 80-plus years. Another reason for this decline is the increasing divide in income distribution. In 1970, the upper class accounted for 20% of the total U.S aggregate income. This left the middle and lower classes to represent 62% and 10% respectively. As of 2018, however, the upper class makes up 48% of the aggregate U.S. income, leaving only 43% for the middle class and 9% for the lower class.
Between the stagnant wages of the U.S. and the increasing divide in who is holding the money, one’s ability to reach a new socioeconomic status has decreased severely. For those in the lower income class especially, children are finding it harder and harder to increase their economic standings above their parents income.
The Reality of The American Dream
However, there is still evidence that the dream is attainable today. Start-ups and entrepreneurs are creating new jobs and avenues for better technology. The U.S. is still the leading country in entrepreneurship, with small businesses making up 99.9% of companies in America. Similarly, the middle and upper-middle classes are growing. For the upper-middle class, we see a shift from 6% of the population in 1967 to 33% in 2016. The data suggests that middle class Americans are still able to reach the next income bracket, it’s just not as common as it has been in the past.
The American dream still lives on today. Peoples of all economic classes are still able to start from nothing and achieve economic success. It just takes a little more of a push than it used it. With wages stagnating and the divide between the classes increasing, it is hard to imagine that the Dream has continued. However, we are a resilient people. We continue to grow our own businesses, to strive for better, to achieve what we set out to do. And because of us, it is still possible, even if it is harder to achieve than it once was. It is a dream, but it can still become a reality.
This article originally published on GREY Journal.