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Is There No American Dream? It Depends.

28 Nov 2014

Well, here is an interesting bit of supposedly bad news.  An economics professor at the University of California-Davis has said he has “crunched the numbers” and found that “America has no higher rate of social mobility than medieval England, Or pre-industrial Sweden.” He added, “That’s the most difficult part of talking about social mobility is because it is shattering people s dreams.”  Gregory Clark insists the numbers don’t lie and that who we will be in terms of our status is largely determined by where our parents were (see article at http://sacramento.cbslocal.com/2014/11/26/uc-davis-economics-professor-there-is-no-american-dream/).

The study, published by the Council on Foreign Relations, asserts that “the so-called American Dream—where hard work leads to more opportunities—is an illusion in the United States, and that social mobility here is no different than in the rest of the world.”  What do we make of this study?  I haven’t seen the actual study, but I am suspicious first of all that Professor Davis might be measuring the wrong thing, even if his conclusions are correct.  It seems that status is not the same thing as well-being, unless he is re-defining the normal meaning.  So while status might not change much, well-being has most certainly increased for all “statuses.”  One has but to look at the lives of Americans at all levels between the early twentieth century and today.  The conveniences that almost all Americans enjoy today would have been undreamed of luxuries to those in my grandfather’s day (indoor plumbing, running water, refrigerators, air conditioning, microwaves, quality health care and medicine, automobiles, much better housing, food of incredibly better quality, if one wants it, etc.).  In fact what we take for granted and even treat as a necessity would have been impossible to obtain or afford by earlier generations, or simply not yet invented.  Prices have declined in real terms for the same kinds of items, quality has increased (compare Walmart products today to “Five and Dime” store products of the late 1950s or even the 1970s), selection has mushroomed.  We get more for less and therefore have more left over to use as we please.  We are better off, much better off.

Now does that mean that people move into some “higher status” on a consistent basis?  I need to know how Professor Clark is defining his terms and measuring his variables.  But at the risk of being a bit snarky, I am inclined to respond to the study that “I don’t care.”  Why am I so glib?  For the reasons I just articulated.  So what if I can’t hob nob with the elites of society—if that is what Professor Davis means.  I am measurably better off in nearly every possible way and live better than kings of the Middle Ages or the Early Modern period.  This is the same kind of problem one could have witnessed in the Renaissance period in Italy, when business people, who were not nobility, began to get richer than the nobles.  Yes, the nobles still had a higher social status, but the businessmen were better off.  In some cases nobles were “dirt poor” because they had squandered their wealth, while the merchants flourished.  This of course was not looked upon favorably and precipitated sumptuary laws that limited how “noble” a person could look and act even if he had a lot more money.  And in those cases social mobility, understood in terms of some form of status, was irrelevant in understanding economic floursishing.

I suppose I need to emphasize the disclaimer that I haven’t seen the study yet, but I can’t imagine how it would in any way challenge the well-documented truth that people everywhere are better off now than they were 100 years ago.  In many places they are much better off.  In the United States they are much, much better off.  Thus I would call into question the relevance of Clark’s study for thinking about real flourishing.  Professor Clark is, I must add, well-respected in economic history, having received positive reviews on his other works by solid scholars such as Tyler Cowen at George Mason University.  Maybe the problem is simply with the nature of the study.  Maybe it measures what isn’t important.  Not to put too fine a point on it, maybe that is a problem with many studies, for example, all those studies on inequality that have inundated us the past few years, but which don’t address the real questions.  So count me a skeptic unless or until I am corrected or get a copy of the study.