A recent poll showed that more than half of all people in this country don’t believe that the American dream is real. Fifty-nine percent of those polled in June agreed that “the American dream has become impossible for most people to achieve." More and more Americans believe there is “not much opportunity” to get ahead.
The public has reached this conclusion for a very simple reason: It’s true. The key elements of the American dream—a living wage, retirement security, the opportunity for one's children to get ahead in life—are now unreachable for all but the wealthiest among us. And it’s getting worse. As inequality increases, the fundamental elements of the American dream are becoming increasingly unaffordable for the majority.
Here are seven ways the American dream is dying.
1. Most people can’t get ahead financially.
If the American dream means a reasonable rate of income growth for working people, most people can’t expect to achieve it.
As Ben Casselman observes at fivethirtyeight.com, the middle class hasn’t seen its wage rise in 15 years. In fact, the percentage of middle-class households in this nation is actually falling. Median household income has fallen since the financial crisis of 2008, while income for the wealthiest of Americans has actually risen.
Thomas Edsall wrote in the New York Timesthat “Not only has the wealth of the very rich doubled since 2000, but corporate revenues are at record levels.” Edsall also observed that, “In 2013, according to Goldman Sachs, corporate profits rose five times faster than wages.”
2. The stay-at-home parent is a thing of the past.
There was a time when middle-class families could lead a comfortable lifestyle on one person’s earnings. One parent could work while the other stayed home with the kids.
Those days are gone. As Elizabeth Warren and co-author Amelia Warren Tyagi documented in their 2003 book, The Two-Income Trap, the increasing number of two-earner families was matched by rising costs in a number of areas such as education, home costs and transportation.
These cost increases, combined with wage stagnation, mean that families are struggling to make ends meet—and that neither parent has the luxury of staying home any longer. In fact, parenthood has become a financial risk. Warren and Tyagi write that “Having a child is now the single best predictor that a woman will end up in financial collapse.” This book was written over a decade ago; things are even worse today.
3. The rich are more debt-free. Others have no choice.
Most Americans are falling behind anyway, as their salary fails to keep up with their expenses. No wonder debt is on the rise. As Joshua Freedman and Sherle R. Schwenninger observe in a paper for the New America Foundation, “American households… have become dependent on debt to maintain their standard of living in the face of stagnant wages.”
This “debt-dependent economy,” as Freedman and Schwenninger call it, has negative implications for the nation as a whole. But individual families are suffering too.
Rani Molla of the Wall Street Journal notes that “Over the past 20 years the average increase in spending on some items has exceeded the growth of incomes. The gap is especially poignant for those under 25 years old.”
There are increasingly two classes of Americans: Those who are taking on additional debt, and the rich.
(cont'd)
The public has reached this conclusion for a very simple reason: It’s true. The key elements of the American dream—a living wage, retirement security, the opportunity for one's children to get ahead in life—are now unreachable for all but the wealthiest among us. And it’s getting worse. As inequality increases, the fundamental elements of the American dream are becoming increasingly unaffordable for the majority.
Here are seven ways the American dream is dying.
1. Most people can’t get ahead financially.
If the American dream means a reasonable rate of income growth for working people, most people can’t expect to achieve it.
As Ben Casselman observes at fivethirtyeight.com, the middle class hasn’t seen its wage rise in 15 years. In fact, the percentage of middle-class households in this nation is actually falling. Median household income has fallen since the financial crisis of 2008, while income for the wealthiest of Americans has actually risen.
Thomas Edsall wrote in the New York Timesthat “Not only has the wealth of the very rich doubled since 2000, but corporate revenues are at record levels.” Edsall also observed that, “In 2013, according to Goldman Sachs, corporate profits rose five times faster than wages.”
2. The stay-at-home parent is a thing of the past.
There was a time when middle-class families could lead a comfortable lifestyle on one person’s earnings. One parent could work while the other stayed home with the kids.
Those days are gone. As Elizabeth Warren and co-author Amelia Warren Tyagi documented in their 2003 book, The Two-Income Trap, the increasing number of two-earner families was matched by rising costs in a number of areas such as education, home costs and transportation.
These cost increases, combined with wage stagnation, mean that families are struggling to make ends meet—and that neither parent has the luxury of staying home any longer. In fact, parenthood has become a financial risk. Warren and Tyagi write that “Having a child is now the single best predictor that a woman will end up in financial collapse.” This book was written over a decade ago; things are even worse today.
3. The rich are more debt-free. Others have no choice.
Most Americans are falling behind anyway, as their salary fails to keep up with their expenses. No wonder debt is on the rise. As Joshua Freedman and Sherle R. Schwenninger observe in a paper for the New America Foundation, “American households… have become dependent on debt to maintain their standard of living in the face of stagnant wages.”
This “debt-dependent economy,” as Freedman and Schwenninger call it, has negative implications for the nation as a whole. But individual families are suffering too.
Rani Molla of the Wall Street Journal notes that “Over the past 20 years the average increase in spending on some items has exceeded the growth of incomes. The gap is especially poignant for those under 25 years old.”
There are increasingly two classes of Americans: Those who are taking on additional debt, and the rich.
(cont'd)
