Posted on January 6, 2012

Americans Increasingly Lack Ability to Climb Economic Ladder

Americans in 2012 enjoy less economic mobility than their peers in Canada and much of Western Europe, the New York Times reports.

In recent years, at least five large studies have identified a "mobility gap" in the United States. For example, a Swedish study found that 42 percent of American men raised in the bottom fifth of incomes stay there as adults — a level of persistent disadvantage that is much higher than what researchers found in Denmark (25 percent) and Great Britain (30 percent). That study also found that just 8 percent of American men in the bottom fifth rose to the top fifth, compared to 12 percent of British men and 14 percent of Danish men. Another study, by the Economic Mobility Project of the Pew Charitable Trusts, found that 62 percent of all Americans raised in the top fifth of incomes stay in the top two-fifths.

While numerous studies have identified large income gaps between the wealthy and the impoverished, the recent studies appear to undermine arguments that American society is inherently "fair," in that everyone can climb the economic ladder and improve their lot in life. Indeed, John Bridgeland, a former aide to President George W. Bush who helped launch Opportunity Nation, told the Times he was shocked by the findings. "Republicans will not feel compelled to talk about income inequality," he said. "But they will feel a need to talk about a lack of mobility — a lack of access to the American Dream."

Skeptics caution that the studies measure "relative mobility" — the likelihood of children to move from their parents' position on the income distribution ladder, which is different from asking whether they have more money. According to the Times, the U.S. maintains a thinner safety net than other rich countries, leaving more children vulnerable to debilitating hardships, and poor Americans are more likely than their foreign peers to grow up with single mothers, which places them at an elevated risk of experiencing poverty and related problems.

"The bottom fifth in the U.S. looks very different from the bottom fifth in other countries," said Scott Winship, a researcher at the Brookings Institution. "Poor Americans have to work their way up from a lower floor."