For those searching for the American Dream, it’s getting scary.
When the writer and historian James Truslow Adams coined the phrase “American Dream” in 1931, the country was in the midst of the Great Depression. But there was hope.
Children born in 1940 had a 92 percent chance of earning a higher income at age 30 than their parents did at the same age. That’s what “American Dream” meant. Adams described it 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.”
But for children born in 1980, the chance of earning more than their parents at age 30 has dropped to 50 percent.
Can you really believe in a dream when it could just as easily become a nightmare?
Here’s the most important part of the study, led by Stanford economist Raj Chetty and published here. Chetty and his colleagues found that the explanation for the fading American Dream is not that the economy isn’t growing fast enough, but that there is too much inequality.
If wealth is distributed among all income groups in the way that it was back in 1940, the American Dream would still be very much alive. Kids born in 1980 would have an 80 percent chance – up from 50 – of earning more than their parents, according to the study.
For years, AFSCME has been well aware of its role as gatekeeper of the American Dream. The research has shown time and again that as labor unions decline, inequality rises. Today, it’s more clear than ever that the future of this dream rests squarely on the shoulders of labor.