The Mobility Myth: Why everyone overestimates American equality of opportunity.
February 15, 2012
When Americans express indifference about the problem of unequal incomes, it’s usually because they see the United States as a land of boundless opportunity. Sure, you’ll hear it said, our country has pretty big income disparities compared with Western Europe. And sure, those disparities have been widening in recent decades. But stark economic inequality is the price we pay for living in a dynamic economy with avenues to advancement that the class-bound Old World can only dream about. We may have less equality of economic outcomes, but we have a lot more equality of economic opportunity.
The problem is, this isn’t true. Most of Western Europe today is both more equal in incomes and more economically mobile than the United States. And it isn’t just Western Europe. Countries as varied as Japan, New Zealand, Singapore, and Pakistan all have higher degrees of income mobility than we do. A nation that prides itself on its lack of class rigidity has, in short, become significantly more economically rigid than many other developed countries. How did our perception of ourselves end up so far out of sync with reality?
IN THE 1830S, Alexis de Tocqueville wrote that, in notable contrast to the “aristocratic nations” of Europe, the United States was a place where “new families are constantly springing up, others are constantly falling away, and all that remain change their condition.” Karl Marx sounded a similar note in 1865 when he observed that “the position of wages laborer is for a very large part of the American people but a probational state, which they are sure to leave within a longer or shorter term.” But it was two American writers who probably did the most to shape our country’s self-image as the land of unbounded opportunity. They were Horatio Alger, of whom you’ve probably heard, and James Truslow Adams, of whom you probably haven’t. When Alger and Adams were alive—and also, for that matter, when Tocqueville and Marx contributed their observations—American opportunity was a much closer match to their superlatives than it is now.
Alger wrote Ragged Dick (1868), Luck and Pluck (1869), and other dime novels for boys about getting ahead through virtue and hard work. To call these books popular would be an understatement; fully 5 percent of all the books checked out of the Muncie, Indiana, public library between November 1891 and December 1902 were authored by Alger. Adams was a more cerebral fellow who wrote books of American history. His influence stems from the fact that one of these books—The Epic of America (1931)—introduced the phrase “the American dream” to our national discourse. Writing at the start of the Great Depression, Adams envisioned not “a dream of motor cars and high wages merely,” but rather “a dream of a 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.”
Born half a century apart, neither Alger nor Adams could claim to have risen from the bottom. Both came from well-established families whose American roots dated to the early seventeenth century. Alger could trace his lineage to three Pilgrims who in 1621 sailed to Plymouth Plantation on the Fortune, the second English ship to arrive there. Adams—no relation to the presidential Adamses—was descended from a man who arrived in Maryland in 1638 as an indentured servant and, within three years, possessed 185 acres. Alger’s father was a Unitarian minister; Adams’s a stockbroker. Both fathers were men of good breeding and education who struggled to make ends meet but were able—at a time when more than 90 percent of the population didn’t finish high school—to obtain higher education for their sons. Alger went to Harvard; Adams went to Brooklyn Polytechnic and, briefly, Yale. Both sons followed their fathers into the ministry and finance, respectively, before they became full-time writers.
Each author was, in his own way, highly successful, but the upward trajectory of these two literary careers would make poor material for a Horatio Alger tale. The circumstances of Alger’s job change are especially problematic. At 34, he vacated the pulpit abruptly when he was charged with “the abominable and revolting crime of unnatural familiarity with boys.” Alger did not dispute the accusation, which was based on the testimony of two teenage boys in his parish, ages 13 and 15, who said Alger had molested them and on rumors that he’d abused other youths in similar fashion. After confessing his guilt privately to William James, the founding father of American psychology, Alger never spoke of it again. Adams left Wall Street under less lurid circumstances. He simply disliked the work and resolved to stop once he amassed $100,000. Reviewing his accounts on his thirty-fifth birthday, he concluded that he’d achieved his goal—the equivalent of about $2 million in current dollars—and resigned the following day. Adams spent much of his subsequent life abroad and wrote The Epic of America in London.
Alger and Adams celebrated America’s capacity for upward mobility, but neither writer idealized his country to anything like the extent that would later be credited to the name Horatio Alger and the phrase “the American dream.” Alger worked into his later juvenile fiction much moralizing against the robber barons’ self-dealing and cruel treatment of the downtrodden. “He has done more harm than he can ever repair,” a character in Alger’s 1889 novel, Luke Walton, laments about a villain modeled on the Gilded Age stock manipulator Jay Gould. Adams deplored America’s tendency to celebrate “business and money-making and material improvement as good in themselves” and its refusal “to look on the seamy and sordid realities of any situation in which we found ourselves.” He even complained about America’s maldistribution of wealth. Still, neither writer had much taste for radical politics. Alger was essentially a mugwump—a good-government Republican distrustful of machine politics and Free Silver populism. Adams was a Tory-minded political independent who became a severe critic of Franklin Roosevelt’s New Deal, which he deemed financially irresponsible.
Both men bequeathed to the United States an exaggerated notion of itself as a mobile society because they lived during the peak years of American mobility—the latter half of the nineteenth century and the early years of the twentieth, when the American industrial revolution was wreaking maximum creative destruction on what had previously been an agrarian economy. The best way to measure mobility is to calculate the economic position of an individual relative to the rest of society and compare that with the economic position of that person’s child relative to the rest of society once that child has grown to a comparable stage in life. To calculate mobility for society as a whole, you therefore need income data over two generations for a large sample of American families. The government, alas, didn’t collect income data during the late nineteenth and early twentieth centuries, but the Census Bureau did collect data on occupations, which can serve as a rough proxy.
In a 2005 paper, Joseph Ferrie, an economics professor at Northwestern, studied census records about the occupations of fathers and sons between 1850 (the year Alger turned 18) and 1920 (21 years after Alger’s death and the year Adams turned 42). Ferrie then compared these records with father-son data from the Bureau of Labor Statistics during the second half of the twentieth century. He divided everyone into four categories: “unskilled worker,” “farmer,” “skilled or semi-skilled worker,” and “white-collar worker.” To keep both data sets consistent, he limited his inquiry to white, native-born males. Ferrie also made some technical adjustments to allow for the different occupational structures of the two eras. What he found was that the equivalent of 41 percent of farmers’ sons advanced to white-collar jobs between 1880 and 1900, compared with 32 percent between 1950 and 1973. Ferrie’s conclusion held up when he looked at all four job categories and when he compared other stretches of the late nineteenth century with other stretches of the late twentieth. Between the horse-and-buggy days and the interstate-highway era, American society had become significantly less mobile.
These findings are all the more striking because the 1950s and 1960s were a period—the last period in the United States, it turned out—when intergenerational mobility was increasing. The economy was booming, and men born during the Great Depression and World War II were enjoying opportunities that their fathers could scarcely imagine. Even so, mobility in this postwar era was no match for the mobility enjoyed by the generations of workers who lived during Alger’s lifetime and James Adams’s youth and early adulthood…