Monday, January 16, 2006

Happy days are here again, with the Dow topping that heady 11,000 mark for the first time since the 9/11 terror attacks! Woo-hoo! Things are so rosy, Congress has treated itself to raises every year since 2001, $20,800-worth, for a current annual income of $162,100 (and that’s before graft is factored in). The total annual compensation of your average CEO of a major company’s skyrocketed to $10 million. These are, indeed, the best of times. But wait a minute. At $5.15 an hour, the minimum wage hasn’t budged in a decade, and real median household income remains stagnant at just under $45,000 per annum. While the Dow surges, companies rush to freeze or terminate pensions. Like so many things in our gilded economy these days, the benefits of the bottom line look a lot better from the top rung of the corporate ladder. For many, these are (still) the worst of times. But, chin up! Some day we’ll all be millionaires, right?

A recent study by Columbia University Sociologist Thomas A. DiPrete, “Is This a Great Country? Upward Mobility and the Chance for Riches in Contemporary America,” begins to explain why so many Americans voted against their own economic interests in recent elections, and persist in siding with the top 1% of the country in its efforts to bankrupt the rest of us. As DiPrete puts it: “[A]n incorrect understanding of the risks and benefits of different medical procedures can interfere with the sensible choice when it comes to major decisions about health care. Misinformation about American income distribution and one’s chances for becoming rich can make it similarly difficult for Americans to take sensible positions on tax policy.” So DiPrete set out to debunk the Get Rich Myth. He found that while an astonishing 51% of Americans between the ages of 18-29 (including 58% of males in this age range) thought it was likely they’d be rich some day, in reality the figure is closer to 5-6%, and depends on your being well-off to begin with. Across demographics, the story’s the same: most Americans consider themselves “pre-rich.” But the truth is, just like the old adage says, it’s mainly the rich who are getting richer.

So, not only is there an increasingly obscene income gap in America, but also a widening gap between the perception and reality of income mobility. Still, the Wall Street Journal editorial that inspired DiPrete’s study got it right: “Americans vote not on their envy but their aspirations.” Optimism is the greatest of American virtues; blind optimism our greatest vice. Next time out let’s aspire to share the American dream rather than limit it to those already living it. This will require a sober look at the reality of class and class mobility in America today. Don’t stop dreaming, because it’s not the American Dream that’s broken. It’s just that it will take more than idle dreaming to make it a reality for more than a tiny minority of already privileged Americans.


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