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The American Dream isn’t as dead as it seems

Rick Newman
Daily Ticker

You’ve probably heard by now: The American Dream has become the Impossible Dream. The nation is going down the tubes. Our kids and grandkids will be lucky if they can get jobs shining the shoes of Chinese and Russian plutocrats.

The latest gloomy update comes from a CNN poll that found 59% of Americans think the American Dream is unachievable. Young adults are the most pessimistic, which isn’t surprising since they’ve suffered the most from a grueling recession and subpar recovery. And while most Americans say they’re better off than the prior generation, they also feel gains in living standards are grinding to a halt, with 63% saying American kids in the future won’t end up better off than their parents.

Ready to give up? Hopefully not, because polls such as this routinely overstate the horrors America will face in the future, as Aaron Task and I discuss in the video above. There’s no doubt times remain tough for many people, with jobs still scarce in many areas, average pay barely rising and many workers tripped up by technological change that makes old skills obsolete and new ones paramount. But America has been through this type of turbulence many times before, and always comes out better off. The beneficiaries are usually self-starters who do what’s needed to adapt to new economic realities.

The CNN poll, like others, doesn’t define what the American Dream actually is. It just uses the phrase as if its meaning is universally understood — which it isn’t. The phrase originated in the truly dismal 1930s, when historian James Truslow Adams wrote about a land “with opportunity for each according to ability or achievement.” He didn’t prioritize homes, cars or other material things, which were layered on over the decades as the United States became fabulously wealthy and material privileges became available to nearly everybody.

If we define the American Dream today in a way similar to its original meaning, it is very much alive. Good jobs aren’t easy to come by, but they do exist. The latest annual “talent shortage” report by placement firm Manpower identifies 10 categories of workers employers have a hard time finding, including carpenters, electricians, plumbers, sales reps, engineers, nurses and technicians with science and math training. Those aren’t all easy jobs, and they don’t exist everywhere. But people willing to go where opportunity is and gain the skills companies are willing to pay for can get ahead much easier than most could during the Great Depression.

Americans have begun to question one central tenet of the post-modern American Dream: The virtues of owning a home. Mournful pundits make it sounds as if that’s a terrible thing, but it’s not. In reality, owning a home commits you to living in one place for a long time and devoting a big chunk of your income to one illiquid asset. In a prosperous and predictable economy, that might not be a problem. But in a fast-changing economy like we have now, workers need to be mobile and agile, so they can go where necessary to get ahead. As millennials choose renting over buying, that could enhance their opportunity and bring some dynamism back to an economy that has stagnated partly because millions of homeowners are stuck in place.

Decades of affluence, of course, have changed the level of prosperity many Americans feel entitled to. That may be the real reason Americans have soured on what they perceive as the American Dream. If you believe that dream represents easy living and a manicured pathway to success, then it probably is dead. But if you’re willing to keep trudging forward and fighting for opportunity, no matter what happens, then you’re following in the footsteps of many successful Americans. The quest for a better life may have been more authentic before it ever had a name.

Rick Newman’s latest book is Rebounders: How Winners Pivot From Setback To Success. Follow him on Twitter: @rickjnewman.