Perhaps because it is a midterm election year, the media is filled with stories about the “Death of the American Dream”. This is a popular political narrative that both major parties love to play on – and play against each other. Vilifying the other party for “ruining America” has long grown tiresome to me, but politicians must see some utility in playing it out election-after-election.
Such is the case with a recent New York Times piece that claimed that “The Recovery Threw America’s Middle Class Dreams Under A Benz”. I won’t even link to the misguided opinion piece – which tells people that “getting ahead by going to work every day now feels quaint.” I feel these defeatist articles fundamentally ignore truths about the social mobility that exists in the United States.
Don’t buy that post-recovery America is filled with opportunity?
Please take a look at this article from the Brookings Institute that references a study they did looking at how people in poverty can reach the American middle-class (>$55K income/year) with three simple behaviors: 1) graduate from high school; 2) get a full-time job; and, 3) wait until you are 21 to get married & have kids.
What they found is heartening: fully 74% of young adults that followed these three simple behaviors reached the middle class in a longitudinal study. Only 2% stayed in poverty. That means one is 37x more likely to reach middle-class success than stay in poverty by following the three simple behaviors.
Here’s a chart from Slate.com that shows the echoes the data behind the three behaviors:
Importantly, the study didn’t say one had to get TOP grades, it didn’t say they needed to have the BEST job, and it didn’t say they necessarily needed to avoid all other BAD habits. They simply needed to graduate, get any full-time job, and wait until they were 21 to take on a spouse or kids. That last one is key because almost 40% of single-parent families are in poverty today – up from just 10% when I was a kid in the 1970s.
If you are wondering about the political bias of the Brookings Institute, a UCLA analysis of Congressional Digest finds that the Brookings Institute has been equally referenced by Democrats and Republicans for much of it’s history. If anything, they have a bit of a liberal bias, as TIME magazine labelled them as “America’s pre-eminent liberal think tank” in the 1970s, and both the Washington Post and MediaFactCheckBias.com recently tagged them as “left/centrist”.
I think the study they did is pretty well done and they have some other studies specifically looking at the impact of marriage and escaping poverty.
I feel you can’t write an early retirement / personal finance blog without thinking about the opportunities that others have to reach at least the ‘middle class American dream’, including people that start their lives in a tough place. I, for one, believe that the Brookings Institute study on this topic is quite credible and stands as a sharp contrast to the painful political protestations I see on TV every night.
Have you seen the Brookings Institute study before? What are your thoughts on it?
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