Benjamin Franklin did it. Henry Ford did it. And US life is built on the faith that others can do it, too: rise from humble origins to economic heights. “Movin’ on up,” George Jefferson-style, is not only a sitcom song, but a civil religion.
However, many researchers have reached a conclusion that turns conventional wisdom on its head: Americans enjoy less economic mobility than their peers in Canada and much of Western Europe. The mobility gap has been widely discussed in academic circles, but a sour season of mass unemployment and street protests has moved the discussion toward center stage.
Former US senator Rick Santorum, a Republican US presidential hopeful, said in the fall that movement “up into the middle income is actually greater, the mobility in Europe, than it is in America.”
National Review, a conservative thought leader, wrote: “Most Western European and English-speaking nations have higher rates of mobility.”
Even US Representative Paul Ryan, a Republican who argues that overall mobility remains high, recently wrote that “mobility from the very bottom up” is “where the United States lags behind.”
Liberal commentators have long emphasized class, but the attention on the right is largely new.
“It’s becoming conventional wisdom that the US does not have as much mobility as most other advanced countries,” Brookings Institution economist Isabel Sawhill said. “I don’t think you’ll find too many people who will argue with that.”
One reason for the mobility gap may be the depth of US poverty, which leaves poor children starting especially far behind. Another may be the unusually large premiums that US employers pay for college degrees. Since children generally follow their parents’ educational trajectory, that premium increases the importance of family background and stymies people with less schooling.
At least five large studies in recent years have found the US to be less mobile than comparable nations. A project led by Markus Jantti, an economist at a Swedish university, found that 42 percent of US men raised in the bottom fifth of incomes stay there as adults. That shows a level of persistent disadvantage much higher than in Denmark (25 percent) and Britain (30 percent) — a country famous for its class constraints.
Meanwhile, just 8 percent of US men at the bottom rose to the top fifth. That compares with 12 percent of the British and 14 percent of the Danes.
Despite frequent references to the US as a classless society, about 62 percent of Americans (male and female) raised in the top fifth of incomes stay in the top two-fifths, according to research by the Economic Mobility Project of the Pew Charitable Trusts. Similarly, 65 percent born in the bottom fifth stay in the bottom two-fifths.
By emphasizing the influence of family background, the studies not only challenge US identity but speak to the debate about inequality. While liberals often complain that the US has unusually large income gaps, many conservatives have argued that the system is fair because mobility is especially high, too: Everyone can climb the ladder. Now the evidence suggests that the US is not only less equal, but also less mobile.
John Bridgeland, a former aide to former US president George W. Bush who helped start Opportunity Nation, an effort to seek policy solutions, said he was “shocked” by the international comparisons.
“Republicans will not feel compelled to talk about income inequality,” Bridgeland said. “But they will feel a need to talk about a lack of mobility — a lack of access to the American Dream.”
While Europe differs from the US in culture and demographics, a more telling comparison may be with Canada, a neighbor with significant ethnic diversity. University of Ottawa economist Miles Corak found that just 16 percent of Canadian men raised in the bottom tenth of incomes stayed there as adults, compared with 22 percent of Americans. Similarly, 26 percent of US men raised at the top tenth stayed there, but just 18 percent of Canadians.
“Family background plays more of a role in the US than in most comparable countries,” Corak said in an interview.
Skeptics caution that the studies measure “relative mobility” — how likely children are to move from their parents’ place in the income distribution. That is different from asking whether they have more money. Most Americans have higher incomes than their parents because the country has grown richer.
Some conservatives say this measure, called absolute mobility, is a better gauge of opportunity. A Pew study found that 81 percent of Americans have higher incomes than their parents (after accounting for family size). There is no comparable data on other countries.
Since they require two generations of data, the studies also omit immigrants, whose upward movement has long been considered a US strength.
“If America is so poor in economic mobility, maybe someone should tell all these people who still want to come to the US,” Heritage Foundation analyst Stuart Butler said.
The income compression in rival countries may also make them seem more mobile. Reihan Salam, a writer for The Daily and National Review Online, has calculated that a Danish family can move from the 10th percentile to the 90th percentile with US$45,000 of additional earnings, while a US family would need an additional US$93,000.
Even by measures of relative mobility, Middle America remains fluid. About 36 percent of Americans raised in the middle fifth move up as adults, while 23 percent stay on the same rung and 41 percent move down, according to Pew research. The “stickiness” appears at the top and bottom, as affluent families transmit their advantages and poor families stay trapped.
While Americans have boasted of casting off class since Poor Richard’s Almanac, until recently there has been little data.
Pioneering work in the early 1980s by Gary Becker, a Nobel laureate in economics, found only a mild relationship between fathers’ earnings and those of their sons. But when better data became available a decade later, another prominent economist, Gary Solon, found the bond twice as strong. Most researchers now estimate the “elasticity” of father-son earnings at 0.5, which means if one man earns US$100,000 more than another, his sons would earn US$50,000 more on average than the sons of the poorer man.
In 2006 Corak reviewed more than 50 studies of nine countries. He ranked Canada, Norway, Finland and Denmark as the most mobile, with the US and Britain roughly tied at the other extreme. Sweden, Germany, and France were scattered across the middle.
The causes of the US’ mobility problem are a topic of dispute — starting with the debates over poverty. The US maintains a thinner safety net than other rich countries, leaving more children vulnerable to debilitating hardships.
Poor Americans are also more likely than foreign peers to grow up with single mothers. That places them at an elevated risk of experiencing poverty and related problems, a point frequently made by Santorum, who surged into contention in the Iowa caucuses. The US also has uniquely high incarceration rates and a longer history of racial stratification than its peers.
“The bottom fifth in the US looks very different from the bottom fifth in other countries,” said Scott Winship, a researcher at the Brookings Institution, who wrote the National Review article. “Poor Americans have to work their way up from a lower floor.”
A second distinguishing US trait is the pay tilt toward educated workers. While in theory that could help poor children rise — good learners can become high earners — more often it favors the children of the educated and affluent, who have access to better schools and arrive in them more prepared to learn.
“Upper-income families can invest more in their children’s education and they may have a better understanding of what it takes to get a good education,” said Eric Wanner, president of the Russell Sage Foundation, which gives grants to social scientists.
Salam wrote that relative mobility “is overrated as a social policy goal” compared with raising incomes across the board. Parents naturally try to help their children, and a completely mobile society would mean complete insecurity: Anyone could tumble any time.
However, he finds the stagnation at the bottom alarming and warns that it will worsen. Most of the studies end with people born before 1970, while wage gaps, single motherhood and incarceration increased later.
Until more recent figures arrive, he said: “We don’t know the half of it.”
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