Who Stole the American Dream?

Yesterday. Barack Obama won a second term as president. It was a victory for the liberal Democrats among us, myself included. Yet the House stayed Republican, and the Senate kept (or possibly slightly enlarged) its slim Democratic majority. The potential for gridlock is still there.


That's too bad. As Hedrick Smith's book Who Stole the American Dream? says, Americans are more economically unequal than at any time since the Roaring '20s some 90 years ago and, before that, the Gilded Age of the late 19th century.

Americans need more than jobs from the next four years. They need good jobs plus good opportunities for advancement.

As Obama's predecessor,  Mr. Smith notes, George W. Bush once averred that income inequality had been "rising for more than 25 years." Bush attributed the rising income gap to "an economy that increasingly rewards education and skills" — attributes that a significant swath of Americans lack enough of.

Others have attributed the wealth/income gap in America to increasing globalization of trade and industry, so that we buy more products made in China and elsewhere — and fewer products made in the U.S.A.

Another blame factor is the rise of high-tech industry. The old "rust belt" industries here in America have long faced reduced demand for their products, while Chinese-made iPhones and iPads fly out the door.

All the above causes of income/wealth inequality may be things that were bound to happen to us sometime, so that they can be seen as problems that are serious but don't necessarily have ready solutions.

But Hedrick Smith makes clear that the main culprits are not insufficient education/skills, not high-tech industries, not globalization. They are instead man-made changes that have transpired since the mid-1970s: Washington's rewriting of key U.S. tax and other laws along with a new selfishness in America's corporate culture.

These twin factors have led to the rise of a super-rich class who have prospered mightily, mainly because of their heightened ability to manipulate their corporations' stock prices while at the same time killing average Americans' jobs.

Smith writes:

Over the past three decades, we have become Two Americas. We are no longer one large American family with shared prosperity and shared political and economic power, as we were in the decades following World War II. ... 

The causes do not lie in the last election or the one before that. They predate the financial collapse of 2008. The timeline to our modern national quagmire lies embedded in the longer arc of our history ... from 1971 to the present ...

There is growing, and disturbing, evidence that America has evolved into a caste society, increasingly stratified in terms of wealth and income, with people at the bottom almost frozen there, generation after generation, and people at the top more and more frequently passing on the self-fulfilling advantages of high status to their children and grandchildren. Increasingly, privilege sustains privilege; poverty begets poverty.

I heard very little talk about boosting opportunity for advancement for middle-class Americans during the election campaign. True, Obama came out for such things as increased aid to community colleges, presented as a jobs-preparation initiative. And that's fine. It would help young people get aboard the gravy train to desirable employment.

But it would not by itself make the necessary changes to the tax code and the regulatory environment that would roll back the structural advantages that today accrue to the very wealthy, thereby putting a glass ceiling over the middle class.