The (Impossible) American Dream

Reconciling these apparently contradictory conclusions is easy. In the late 1960s, the black middle class was tiny. The group cited by Pew represented only about 8 percent of black children. Whatever happened to them has been overwhelmed by the gains of other black families. (A further drag on black gains is lower marriage rates, which often deprive families of a second earner. But that's not the fault of the economy.) Contrary to media coverage, the findings in three recent Pew studies qualify mostly as good news:

• When compared with their parents in the late 1960s, these families today have a median income that's 29 percent higher at $71,900 (and this understates gains in living standards, because families are about 25 percent smaller and the income figures exclude fringe benefits and non-cash government benefits).

• About two thirds of today's adults have incomes higher than their parents did—a result that is roughly similar for both blacks and whites (the children of the middle-income group of blacks were not typical).

• Almost 60 percent of the children born of the poorest families moved up the income distribution (23 percent into the second-poorest fifth and 6 percent into the richest fifth).

Indeed, the high degree of intergenerational economic mobility is Pew's most interesting finding. What happens at the bottom of the income scale also happens at the top. About 60 percent of children born of the richest fifth of parents do not themselves end up among the richest fifth; about 23 percent drop into the next-to-highest group and 9 percent fall to the bottom. Parents influence their children's destiny but do not determine it.

Everyone knows that economic inequality has increased in recent decades. The richest 10 to 20 percent of Americans have gotten richer faster than the rest. But the people at the top are not all the same people or even the children of the same people. This vindicates one version of the American dream. There is opportunity. People do move up—in both total income and class rank. Economic success is not static.