“Sadly, the American dream is dead.” So Donald Trump tweeted as he began his presidential campaign in 2015. He then added, “But if I get elected president, I will bring it back bigger and better and stronger than ever before, and we will make America great again.” And so, Trump was elected and Make America Great Again (MAGA) was born.
For many, the simplest expression of the “American dream” is a belief in economic mobility, that one’s children will have a better life, a higher standard of living, than their parents. A “better life” has long meant going to college, getting a good job, getting married, starting a family, owning a home and feeling good about oneself.
However, as a recent You/Gov poll found, many Americans share Trump’s belief that American dream is fading, if not dead. Less than half (43%) of American adults believe that the American dream exists while a third (35%) do not believe in it and a quarter (23%) are unsure if it exists. Unsurprising, Republicans (62%) and people 65 and older (53%) are more likely than other Americans to still believe in the dream while less than a third (29%) of adults under 30 believe in it and a third (31%) are uncertain.
So, was Trump right when he ranted, “Sadly, the American dream is dead”? More troubling, if he’s right, can it be brought back?
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The term “American dream” appears to have been first formally used by James Truslow Adams in his 1931 novel, Epic of America. It is “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,” he wrote. He then goes into more detail:
Its achievement is not a dream of motor cars and high wages merely, but a dream of social order in which each man and each woman shall be able to attain to the fullest stature of which they are innately capable, and be recognized by others for what they are, regardless of the fortuitous circumstances of birth or position…
The American dream … a dream of being able to grow to fullest development as man and woman, unhampered by the barriers which had slowly been erected in the older civilizations, unrepressed by social orders which had developed for the benefit of classes rather than for the simple human being of any and every class.
Adams’s novel appeared during the presidency of Herbert Hoover who chose as his 1928 presidential campaign slogan a simple promise: “a chicken in every pot and a car in every garage.” It captured the spirit of the nation’s optimistic possibilities, of social mobility that envisioned ordinary (white) Americans living a better, more comfortable, middle-class life.
However, the stock market crash of October 24, 1929, set in motion the Great Depression. Hoover believed the mounting crisis was part of a passing recession and took a hands-off approach, refusing to involve the federal government in key economic issues like price regulation or currency valuation. As the Gilder Lehrman Institute notes, “[Hoover] was inclined to give indirect aid to banks or local public works projects, but he refused to use federal money for direct aid to citizens, believing the dole would weaken public morale.” Franklin Roosevelt was elected president in 1932 and his “New Deal” programs together with the mobilization of the WW-II economy gave new life to the American dream.
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During the postwar era, U.S. capitalism witnessed phenomenal growth, giving birth to globalization and the modern consumer society. Those were the days when New York became the capital of the 20th century. As London, Paris, Berlin, Moscow and Tokyo slowly recovered from the devastation of world war, New York was booming. “New York is not a state capital or a national capital,” E. B. White famously wrote in 1949, “but it is by way of becoming the capital of the world.” In 1950, the city’s population topped 7.5 million people; Washington, D.C., was about one-tenth its size, with 800,000 residents.
In the decade following the war, the U.S. was remade. The nation was transformed from an agricultural to an industrial economy; from a local to a continental territory; from a rural to an urban and, increasingly, a suburban nation; from a white to a mixed-race society; and from a nation state to a global power.
For ordinary working- or middle-class Americans, the postwar period saw unprecedented wage increases along with key ancillary benefits like unemployment compensation, retirement plans and social insurance programs. The highway system built during the war to enable the two-front war effort — Atlantic and Pacific coasts — facilitated the great population relocation from the east to the west and from the city to the suburbs. The GI Bill enabled urban renters to become first-time home buyers and see high-school grads go to college; restrictive covenants and other policies blocked African Americans from much of the postwar prosperity.
Between 1945 and 1960, 12 million houses were constructed across the country. William J. Levitt, the creator of “Levittown” sold houses for as little as $6,900 and more up-market ranch-style house sold for about $10,000; down payments were low, and financing was only 2 to 3 percent.* The Levittown development on eastern Long Island, NY, consisted of 17,400 houses, some sporting three bedrooms, a fully equipped kitchen and bathroom, and a living room with a panorama window. The development was home to more than 80,000 people – all white!
Trump is a child of the postwar American dream. He was born in 1946, and grew up in Jamaica Estates, Queens. It was a well-to-do and all-white neighborhood, with up-market homes set back on tree-lined streets, about 35 miles east of Manhattan. Donald’s father, Fred Trump, was a real-estate developer who did not serve during the war but made a fortune by the postwar housing boom. In 1927, he was one of seven men arrested as 1,000 white-robed Ku Klux Klan supporters marched through his Jamaica neighborhood during a Memorial Day Parade. He was a strict father, a stern, formal man with a thick mustache and hair combed back who insisted on wearing a tie and jacket at home. He was a conservative Republican who associated with the leading city and state Democratic politicians and (Jewish) real-estate developers.
In 1948, Donald Trump was 2 years old, and the postwar development market was booming. Fred Trump built the family’s luxurious Georgian Revival house at 85-14 Midland Pkwy. It was palatial, with a 17-step walkway leading up a sloped-walkway to the front door, a doorway framed by a Colonial-style portico, a stained-glass crest and six white columns. The house was over 4,000 sq. ft., had 23 rooms, 9 bathrooms on a lot estimated at 40 to 60 feet wide, 140 to 150 feet deep. Two Cadillacs were often parked in the driveway, with license plates embossed with Trump’s initials, “FCT1” and “FCT2.” The house was supported by a cook and a chauffeur as well as the latest gadgets, including an intercom system and color television.
However, everything during the postwar era was not as rosy as the Trump mansion. The first postwar recession hit in 1948-1950, foreshadowing troubles yet to come; the city went through a second downturn in ’53-’54 following the Korean War. The decade ended with the deeper, worldwide recession of ’57-’58 that some argue was the most severe economic crisis of the postwar era. Nothing signified the nation’s reorganization than the Bronx Giants and the Brooklyn Dodgers relocation to San Francisco and Los Angeles, respectively, in 1957. Making matters worse, as the Federal Reserve reports, “in 1964, inflation measured a little more than 1 percent per year. … Inflation began ratcheting upward in the mid-1960s and reached more than 14 percent in 1980. It eventually declined to average only 3.5 percent in the latter half of the 1980s.” It also reports that in ’64 unemployment was 5 percent, and by the summer of 1980 it topped 7.5 percent. The postwar recovery that fashioned the American dream ended with the 1973-1975 recession.
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Trump was elected in November 2016 and held office from January 2017 through January 2021. In launching his 2015 presidential campaign, Trump promised: “But if I get elected president, I will bring it back bigger and better and stronger than ever before, and we will make America great again.”
Trump took office following Pres. Barack Obama and recovery from the disastrous Great Recession of 2008-09. As Fortune reported just before Trump’s term ended in January 2020, “During the first three years of Donald Trump’s presidency, the economy did quite well. The unemployment rate hit a 50-year low, income growth doubled, and the economic expansion he inherited grew into the longest in American history.” ABC News seconded this assessment,noting, “Trump inherited an economy from the Obama administration that was expanding, and it continued to do so during the first three years of his presidency. While real wage growth was slow or stagnant for most Americans, and had been under Obama, unemployment continued to trend downward and GDP continued to grow.”
The first years of Trump’s presidency benefited from the Republican-promoted $2 trillion Tax Cuts and Jobs Act adopted in December 2017. As ABC News reported, it “provided major tax breaks to corporations and wealthy individuals. The policy, among other things, reduced the corporate income tax rate from 35% to 21%.” However, as Fortune reminded its readers, “Trump to leave office with the worst jobs record since Herbert Hoover.”
Trump left office facing one of the nation’s gravest medical-political crises, the Covid-19 pandemic. In January 2020 when the first signs of the pandemic appeared, Trump sought to reassure the nation, declaring, “We have it totally under control. It’s one person coming in from China. It’s going to be just fine.” In February, he reiterated his message: “We pretty much shut it down coming in from China.” And again, “Looks like by April, you know in theory when it gets a little warmer, it miraculously goes away.” But as Rep. Lloyd Doggett (D-TX) pointed out, “Trump’s term in office saw over 25 million confirmed coronavirus cases in the United States, over 400,000 of which resulted in death.”
When Trump launched his presidential campaign in 2015, he insisted: “But if I get elected president, I will bring it back bigger and better and stronger than ever before, and we will make America great again.” However, during much of his 2020 reelection campaign, little mention was made of the American dream. It was not until the final months of the 2020 campaign when it was recalled as a repeatedly stated campaign slogan. A few examples are illustrative.
In August 2020, Trump claimed: “This election will decide whether we SAVE the American Dream, or whether we allow a socialist agenda to DEMOLISH our cherished destiny.” And insisted: “This election will decide whether we save the American dream or whether we allow a socialist agenda to demolish our cherished destiny.” Also in August, his campaign committee “announced the launch of four new campaign coalitions to promote President Trump’s fight for economic empowerment, quality education, and law and order. The coalitions, ‘Indian Voices for Trump,’ ‘Hindu Voices for Trump,’ ‘Sikhs for Trump,’ and ‘Muslim Voices for Trump’ ….”
In September at a campaign rally in Nevada, he insisted that the 2020 election is “the American Dream versus the American nightmare.” Adding, “A vote for Republicans is a vote for safe communities, great jobs, a limitless future, it’s really a vote for the American dream. It’s the American dream versus the American nightmare.”
In October, six days before Election Day at a rally in Arizona, he announced the“American Dream Plan: Opportunity for All.” It was targeted to Hispanic Americans and, he insisted, it would enable them to “… have a fair shot at the American Dream, Hispanic families—like every family—deserve the opportunity to choose the best education—including kindergarten through twelfth-grade (K-12), college, or vocational school—for their children.”
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Did Donald Trump foretell the nation’s fate when he warned, “Sadly, the American dream is dead”?
Trump was not alone in warning about the end of the American dream. In 2016, the Russell Sage Foundation (RSF) voiced a similar concern, “The rise in economic inequality over the past four decades calls into question the notion that anyone, regardless of the status of their parents, can achieve the American Dream.” And in ’17, the Harvard economist Raj Chetty and colleagues published a piece in Science Daily entitled “The Fading American Dream.” They noted, “One of the defining features of the “American dream” is the aspiration that children have a higher standard of living than their parents.” They add,
There have been two important macroeconomic trends that have affected the incomes of children born in the 1980s relative to those born in the 1940s: lower Gross Domestic Product (GDP) growth rates and greater inequality in the distribution of growth.
They conclude, “We found that the rates of absolute mobility have fallen from approximate 90% for children born in 1940 to 50% for children born in the 1980s.” What can only wonder what the rate of absolute mobility for children born in the 21st century.
The most disturbing indicator of the eroding belief in the American dream is the deepening gap between the “have-mosts,” the “haves” and the “have-nots.” Pew Research found that “the 1980s marked the beginning of a long and steady rise in income inequality.” It reports that, in 2018, the median income of U.S. households stood at $74,600. This was nearly 50 percent than its level in 1970, when the median income was $52,200; incomes are expressed in 2018 dollars. Digging deeper, it finds “most of the increase in household income was achieved in the period from 1970 to 2000.” However, over the last two decades, household income growth flattened out, averaging on 0.3 percent annually.
Going further, Pew notes, “since 1980, incomes have increased faster for the most affluent families – those in the top 5% – than for families in the income strata below them.” It points out, “Upper-income families were the only income tier able to build on their wealth from 2001 to 2016, adding 33% at the median.” It adds, “As of 2016, upper-income families had 7.4 times as much wealth as middle-income families and 75 times as much wealth as lower-income families.”
Often forgotten, growing income equality was an issue in the 2020 presidential campaign and Trump engaged it. In August 2020 he tweeted a Business Insider graphic and video showing that during the pandemic 40 million Americans filed for unemployment while the net worth of billionaires increased by half a trillion dollars. “I actually agree with this,” Trump tweeted. “Too much income disparity. Changes must be made, and soon!”
At a September 2020 news conference at the InterContinental Barclay New York Hotel during the UN General Assembly, Trump proclaimed that “inequality is down.” However, as Common Dreams and others reported, the Census Bureau found that income inequality reached its highest level in the past 50 years, with Gini Index—which measures inequality on a 0 to 1 scale, with 0 representing perfect equality—reached 0.485 in 2018.
Today, income inequality shapes what remains of the American dream, and nothing captures this change than the decline in first-time home buying. Since the post-WW-II recovery, homeownership symbolized the fulfillment of the American dream. A 2022 poll found that nearly three-quarters (74%) of Americans place owning a home above career, family and college as a sign of prosperity. The National Association of Realtors (NAR) reports a 38 percent decline in such buying in 2022 over last year – the lowest rate since 1987. It also estimates that about 2.5 million households — or 15 percent — of those shopping for a first home will be shut out of the market this year. The decline in available homes for first-time buyers, significant price increases, and increasing mortgage costs, may signal the end of that dream.
Notes.
* $7,000 in 1950 is the equivalent of $86,200 in 2022 dollars; http://www.usinflationcalculator.com