Is the American Dream Over?
By Jay Jung, President and Founder — Embarc Advisors
Everyone is making dire predictions about the growing wealth gap in the United States. While it’s true the last few generations have seen the upper class and lower class moving a bit farther apart, this is no indication that upward mobility is impossible or even unlikely. A recent report from the Pew Research Center shows in black and white that household incomes in the United States have trended upward since 1970. When you tune out alarmist rhetoric, the facts don’t lie. All the real evidence points to an American Dream that is alive and well.
America is still a land of opportunity
We’ve heard the immigrant-success story so many times that it is almost cliché. Where else in the world can people arrive with nothing, without a transferable degree, without even knowing the language, and then work their way to the top?
Our economy is uniquely designed for upward mobility. Entrepreneurs in the US have access to the most substantial capital market in the world. Data in Crunchbase shows that in the previous year, venture investors backed startups with almost $270 billion. That averages to approximately $800 for each US citizen and amounts to the highest rate of startup investment per capita in the world. In addition to private funding, the federal government offers small-business loans. In fact, just last month, the US Small Business Administration announced that nearly $390 billion is slotted to assist 4 million small businesses still struggling after the pandemic.
It’s important to remember that the US still has the world’s most robust consumer economy. Americans comprise less than 5% of the global population, yet we earn over 20% of the world’s collective income. Families in the US spend almost three times more than families in any other country.
In addition, America offers an infrastructure for technology and communication that is unmatched anywhere. More than anything else, access to this technology lowers barriers to entrepreneurship and levels the playing field.
Are all Americans able to achieve the American dream?
Many people consider the 1% and think the economy is unfair. After all, how many people achieve that kind of success? There will always be outliers, but the truth is that realistic wealth is not out of anyone’s grasp. Believe it or not, a study of the 140,000 people in the US with incomes over $1.58 million per year shows that most simply own a regional business. The majority of millionaires in this country are not doctors, lawyers, engineers, or tech developers; rather, they own construction companies, automobile dealerships, and gas stations.
Overnight success may be someone’s dream, but it was never the American dream. That dream has always been based on hard work, ingenuity, and persistence, and it still is today. While owning a grocery store may not be as exciting as other jobs in Silicon Valley, it’s attainable. All anyone needs is a realistic vision, a well-researched business plan, financing, and a willingness to work. In this country, no one can honestly say success is out of reach.
Are we losing sight of the American dream?
Stories about a growing wealth gap make perfect news spots. After all, we all have moments where we feel our paycheck could go a little further. On days like that, it’s easy to want to find something to blame. Unfortunately, this dialogue is not harmless. In fact, when taken to its extreme, it threatens to build support for policies that could destroy the real American dream as we chase a look-alike fantasy that never existed.
What makes our nation one of the strongest economic powers in the world is still working. Everything you need to chase the American dream is in place. Don’t allow yourself to be distracted from taking matters into your own hands and bettering your own situation. Statistics about income equality and upward mobility do not control your actions or your outcomes. In this country, every individual still has direct influence over their trajectory. Everyone has something that could hold them back, but people who achieve the American dream have the persistence to turn setbacks into possibilities.
Instead of falling into the misconception that you cannot rise higher on the economic ladder, listen to the facts and press onward. The American dream won’t fall into your lap, but it is still within reach.
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